Pentagon Lays Out Challenge Posed by China's Growing Military Might

WASHINGTON—China's rapidly growing military spending is paving the way for the country to expand its sphere of influence and challenge the U.S. across the globe, the Pentagon said, in a report laying out challenges facing America as it steps up involvement in Asia.

While U.S. military spending is in decline, China is spending billions of dollars to develop stealth fighters, cyberweaponry, armed drones and a growing naval fleet that...